Why Leasing Your Next Car Makes Better Sense Than Buying One!
Keywords: car, leasing, contract, hire, prestige
In the UK motorists have historically preferred to always ‘Buy’ their new cars by using up their savings or taking out a personal loan, neither of which make sound financial sense, for one main reason, DEPRECIATION!!
Every single vehicle sold in the UK today loses a huge amount of its value over the 1st 3 years of its life, infact a large percentage of these vehicles being worth less than 40% of the initial purchase price after 3 years. For example an executive car purchased for 30000 pounds could be worth less than 12000 pounds after only 3 years, frightening isn’t it! And yet in the UK people continue to buy their new cars, but why?, because if I compared it to home buying for example, you wouldn’t want to buy your next house for 200,000 pounds to find that when you wanted to move 3 years later that it was only worth 80,000. pounds
It is because of this steady decline in vehicle values across the marketplace that several interesting alternatives have started to become of interest to the private individual, despite many businesses having used these alternative means of obtaining their company vehicles for many years.
One of the interesting features of obtaining vehicles via these means is the fact that for years business users have managed to take advantage of huge discounts of thousands of pounds off their new cars, whereas the man on the street used to be happy with 500 pounds off and a set of mudflaps/full tank of fuel and think they were getting a good deal! Now the private individual is able to receive the same huge discounts off their chosen vehicles as well by using vehicle brokers, so that’s a huge saving already.
The most popular of all these funding types is Contract Hire be it personal or business, which in a nutshell means that the car is purchased on a set contract for example over 3 years based on an annual mileage of 10,000 miles per annum . The customer pays a small initial deposit of the equivalent of 3 monthly rentals before delivery of their new car and pays the balance over the 3 years, and at the end they simply hand the car back and start again. In every case the client will find that the amount of money they have paid to run their car for the 3 years is less than what they would have lost had they purchased it instead.
The other bonus is during the entire contract their road tax is included and paid for, and they have the full manufacturers warranty and roadside assistance, just as they would if they’d bought the car. The only additional costs they may have at the end of the contract is if they have gone over the agreed mileage, and for that they would have to pay the agreed excess pence per mile charge.
For those individuals that still want to have something to ’show’ for the money they’ve spent over the years, there is personal contract purchase or PCP as most people know it by. With this type of contract as with Contract hire the individual takes advantage of fleet discounts again and pays a similar 3 payments in advance followed by 35 payments as before, but has set out at the beginning of the contract something called a Guaranteed future value, which is the amount that the funder values that vehicle will be worth at the end of the contract term. So once the client has reached the end of the contract, rather than simply handing the car back as with contract hire, they have 3 choices:
1. They can ‘pay’ the GFV and then by rights they will ‘own’ the car, so it is theirs to sell on, part exchange or continue to use. This is where some clients like to try to make some money back, by selling the car on for more than they have just paid for it, but this has the added inconvenience of having to advertise and deal with potential buyers of your car.
2. Alternatively they can choose to refinance the GFV and therefore continue to use the vehicle till that agreement has been paid off and again at that point the client will ‘own’ their car.
3. Or finally they can just choose to hand the car back to the dealer and start again.
So hopefully over the coming years more and more private individuals will keep the majority of their hard earned savings in the bank or invest in property, but never should they look to ‘Buy’ their next new car.
Shaun Parker has been at the forefront of the car hire and car leasing industry for several years. He has arranged finance for hundreds of satisfied customers. To find out more visit www.ambervehiclesolutions.co.uk
Previous Articles Highlighter:
Aerospace Advanced Composites In Automobiles (1)
For example, advanced composites (e.g., carbon fiber) are currently used in several specialty road cars, concept cars, and in many racing cars. However, these are not produced in high-volume or for use in large parts.
Tips On Choosing A Wedding Car (2)
Years ago weddings were a local affair, but now with more choice of venues on offer, people will travel several miles to find the destination of their dreams. If people want to hire a wedding car, due to distance and the increase in traffic, the wear and tear on the old cars in considerable.
Choose The Right Limousine For Your Needs (3)
Once you have decided on the number of people that will using the limousine you can now decide which of the many styles will suit you needs. For parties of up to ten the classic sedan is always a good choice.
How To Locate A BMW Indianapolis Dealership Close To You (4)
Using the Internet as a Resource Instrument If you are searching a BMW Indianapolis dealership close to you, then a excellent thought is to work with the world wide web since the efficiency and the speed of the Internet permits you to be capable of easily and quickly determine precisely what it is that you are searching for, and so this evidently keeps from wasting a lot of effort and time in the end of it all.
The First True Production Model Porsche The Porsche 356 (5)
The Speedster production peaked at 1,171 cars in 1957 and was replaced in 1959 by the Convertible model D which featured a taller and more practical windshield as well as more comfortable seating.
Booster Seats Protect Children (6)
Using just a seat belt, kids are 3.5 time more likely to suffer significant injury, and four times more likely to suffer a head injury. Booster seats are 60 percent more effective than seat belts alone.
Some More Common Car Sales Tricks (7)
For example if it has been determined that you are a payment buyer the slick salesman will just keep quoting the payments to you and not even pay attention to the price of the car.
Some Of The Many Reasons You Need To Protect Your Car's Finish With A Car Cover (8)
At custom shops they will embroider your cover with names, pictures, sports teams and just about anything you wish to have put on one. Another great place to find car covers is by using the Internet.
Japanese Car Makers Aren't The Only Ones Producing Hybrids (9)
It has been around the American car landscape for a century and people often think highly of the company and of the model T. Ford did not get into the hybrid market as quickly as either Honda or Toyota but it did work to pick itself up quickly with its Ford Escape hybrid.
Low Cost Tractors: What Factors Should You Look For When You Want To Buy One? (10)
the ones you need. Richard J. Runion is the President of Geostar Publishing & Services LLC. Rich loves net research & blogging. His new blog on NorTrac Tractors is fast becoming popular, as it is comprehensive and well-researched.
Obstacles To Overcome When Renting A Car (11)
Some travelers will use a variety of coupons to avoid obstacles that stand in their way when renting a car. They might choose a compact car because an upgrade coupon will save them quite a few dollars.
What Are Hybrid Automotives? (12)
The history of hybrid power technology is very old. It dates back to the time when diesel electric submarines were first used. The idea is quite simple, use two power sources to increase the overall efficiency.
Online Classified Ad Tips For Selling A Used Car (13)
After you have determined a price and written an effective ad, the next step is to prepare your vehicle for sale. Have your car professionally cleaned and detailed, and instead of spending money on major repairs, which will likely cost you more than the price that you will receive for the car, plan on being honest about the condition of your car, both in the ad and in person.
Contract Hire: How Does It Work And What Can I Get? (14)
Seat Leon Stylance The 1.9 TDI 5 door Seat Leon Stylance is a fantastic example of a stylish small car that will provide you with a classy compact vehicle whatever your needs.
Here Are A Few Buying Tips I Learned From My Years In The Car Business (15)
Ask him what the most reliable vehicles are on the road, and he should be able to give you an idea of what automobiles to look into, and which ones to avoid.
How To Improve Gas Mileage To Save Money (16)
Routine maintenance intervals are often suggested for every 3,000, 15,000, 30,000, 45,000 and 60,000 miles on a car. Michael Murray is an author of automotive articles and owner of a blog all about how to beat a speeding ticket: beatyourspeedingticketnow.blogspot.com
My Goldwing Trike - Cured My Mid Life Crisis (17)
It is the anniversary edition with the cobra sidecar conversion and is in showroom condition, however at nearly 35,000 bucks it is a once in a lifetime experience. Riding a Goldwing Trike takes a little getting used to but the kit conversion has been done so well it gives that feeling of confidence which you get when your driving an expensive car, it corners great and the performance engineered suspension just makes it a dream to ride.
Time To Vote Yes Or No On Motorcycle Protective Clothing (18)
Do you know that 30% (50% at night) of drivers caught up in accidents with motorcycles claim they didn't see the biker? I can't calculate the times I have had to dart cars who I know just didn't see me.
Simple Car Maintenance Tips That Will Keep Your Car Running Properly (19)
This will damage the engine to cease. Once this has happened, you either need a new engine or a new car. Both of these issues are extremely costly.
Gas Prices Reach Record Heights (20)
And in the rest of these United States, prices are rising to match. According to the Los Angeles Times, the average price of petrol in the lower 48 is now $2.50 per gallon.
Newer Articles Highlighter:
Buying A Classic Car (1)
1 Answer offers a selection of insurance deals and promise that you will not find a cheaper quote or you will get your money back. www.1answer.co.uk has all the information you need to help you find the cheapest insurance for you.
Looking To Rent An RV - 5 Things You Need To Know (2)
5. Include alternative transportation in your vacation/RV plans - Unless you are pulling a smaller camping trailer that you can disconnect from your car you may need to plan for another way of getting around when you finally arrive at your destination.
When Buying Motorcycle Boots Safety Takes First Place Over Fashion (3)
Riding a bike is very risky as one is susceptible or prone to accidents very often. It is important to be very careful while riding. Wearing proper protection, such as helmets to protect ourselves, is a must.
The Use Of Car Battery (4)
Group numbers of the battery may vary but you may acquire it on the same price. Another factor that is important in sizing the batteries performance is the CCA ( cold cranking amps ) ratings that measures the amps if they exceed or meet the at 0 degrees F and can sustain for 30 seconds while having a voltage higher than 7.2 depending on the condition of the climate of the place.
Hire A Limousine, You Will Not Regret It (5)
You should plan your itinerary in advance so that he limousine will be available to take you to and from meetings or on sightseeing tours. You can relax and enjoy the sights while someone else does the driving.
What You Need To Know About The Proper Tires For Winter Driving (6)
Yet, keep in mind that winter tires aren't a cure-all, despite being a good back-up if you do happen to get caught in bad weather. If you have an option to stay at home during extreme weather conditions, this will provide you the most protection against a snow-related accident.
Getting Satellite For Your RV Makes Life Easy On The Road (7)
One of the most popular new features for recreational vehicle owners is the ability to have satellite television programming while they are on the road. In the recent past most recreational vehicle drivers had a VCR and, or a DVD player in their traveling homes.
The Best Used Car Financing Revealed (8)
It helps to negotiate the price of the car before discussing the terms of the loan. TIPS ON AUTO FINANCE: HELP FOR ENSURING YOU GET THE BEST DEAL - Educate yourself on used car financing so you know what to expect when shopping.
Why The Electric Scooter Is So Popular Among People Of All Ages (9)
You can also choose stand up or sit down types. The stand up are very popular with young children and teens but for most people they will prefer the sit down variety as they offer much more comfort.
Crashworthiness: A Legal Doctrine (10)
Certainly, there are several legal factors that enter into an automobile accident investigation and litigation. Circumstances surrounding the accident, such as weather conditions, possible intoxication or impairment on the part of one or both drivers, and fault or intention are key.
How To Prepare For And Take A Car On Test Drive Before You Buy (11)
Drive the car in the daylight in midday preferably when the sun is hottest, to see how well the air conditioning performs. Listen closely for grinding noises when the A/C kicks in.
Don't Get Burned By Car Dealer Tactics (12)
Hopefully this has helped you to see some of the tactics used by auto dealers. Gregg Hall is a business consultant and author for many online and offline businesses and lives in Navarre Florida with his 16 year old son.
Factors To Look At When Considering A Car Loan (13)
Car loans are loans with need much consideration by the customers and only then they should be settled upon. There are several factors that should be analyzed in detail before taking any kind of decision regarding considering a car loan.
What Is A Supercar And Why Is So Exciting About One (14)
A supercar is usually factory built and not modified by it's owner. There are several factors that go into building one. 1. Acceleration - These cars are fast going up to 160 m.p.h.
Guide In Buying A Motorbike Helmet (15)
If the helmet falls off, then you would need a smaller size. A helmet that falls off on the initial impact is as good as not wearing any at all.
Some Safety FeatureTips You Should Always Keep In Mind When Buying Sports Cars (16)
Seat belts can assist in saving you and your family in case of automobile accidents. Make sure that the vehicle has adjustable shoulder harnesses so that the belt can be adjusted to fit to the passenger's height.
How To Be Sure That The Car You Are Interested In Hasn't Been On The Bottom Of Lake Ponchatrain (17)
This can be particularly helpful in ascertaining whether or not the owner is being honest with you. You'll also want to find out what the fair market price is of the car by looking up its Kelley Blue Book value.
How To Do Leather Detailing And Color Matching Properly For Your Vehicle (18)
Use a water based and alcohol cleaner for best results. Sand out all cracks using 320 or 400 grit sandpaper, as far down as to bare leather if necessary.
SUV Rollover Accidents - What To Know Before Buying An SUV (19)
Most SUVs are designed - and owners are encouraged - to carry extra weight in the form of extra passengers and cargo, whether it is on the road or off the road.
A Few Things You Need To Know About Lowering Your Car (20)
This will result into initial savings since there is no need to purchase a lowering spring, shock, and camber kit or a long steering arm. But the trade off would come in a few weeks time since the shock would initially be compressed.
Permalink to Why Leasing Your Next Car Makes Better Sense Than Buying One!